Just-In-Time for Reducing Inventory Costs throughout a Supply Chain: A Case Study
Supply Chain Management (SCM) is the integration
between manufacturer, transporter and customer in order to form one
seamless chain that allows smooth flow of raw materials, information
and products throughout the entire network that help in minimizing
all related efforts and costs. The main objective of this paper is to
develop a model that can accept a specified number of spare-parts
within the supply chain, simulating its inventory operations
throughout all stages in order to minimize the inventory holding
costs, base-stock, safety-stock, and to find the optimum quantity of
inventory levels, thereby suggesting a way forward to adapt some
factors of Just-In-Time to minimizing the inventory costs throughout
the entire supply chain. The model has been developed using Micro-
Soft Excel & Visual Basic in order to study inventory allocations in
any network of the supply chain. The application and reproducibility
of this model were tested by comparing the actual system that was
implemented in the case study with the results of the developed
model. The findings showed that the total inventory costs of the
developed model are about 50% less than the actual costs of the
inventory items within the case study.
[1] R. A. Hokoma, M. K. Khan & K. Hussain, "Investigation of the senior
management strategy towards implementing manufacturing, planning
and control techniques and philosophies within the Libyan cement
industry: a case study", Proceeding of the 23rd ISPE International
Conference on CAD/CAM, Robotics and Factories of the Future,
Bogota, Colombia, 2007.
[2] F. El-Dubei & R. A. Hokoma, "Minimizing inventory costs throughout
the supply shain within a cement factory: A Case Study, MEQA, 4th
Annual Congress, Dubai, UAE, 2010
[3] F. Grange, "Challenges in modeling demand for inventory optimization
of slow-moving items". Proceeding of the 1998 winter simulation
conference. Pp. 1211-1217, 1998.
[4] M. Mobbs, (2001), The mineral industry of Libya, U.S. geological
survey, available at: <http://minerals.usgs.gov/minerals/pubs/country>
[Accessed 17th November 2011].
[5] R. A. Hokoma, M. Tughar, R. Abdussalam, E. Ramadan & S. Bindra,
Strategic impact of JIT techniques for construction industry, Proceeding
of the Second International Engineering Conference on Construction and
Development, Gaza, Palestine, 2007.
[6] R. A. Hokoma, M. K. Khan & K. Hussain, Investigation into the Various
Implementation Stages of Manufacturing and Quality
Techniques/Philosophies Within the Libyan Cement Industry, Journal of
Manufacturing Technology Management, Volume 19, No. 7. Pp. 893-
906, 2008.
[7] R. Abdulssalam, R. A. Hokoma, M. Esbiga & H. Omer., Strategy
applied towards implementing JIT and MRPIUI planning and control
techniques within Libyan construction and cement industries,
proceedings of the international conference on technology management
(ictm), Kuala Lumpur, Malaysia, 2006.
[8] R. Operta & P. Taylor, "Operations Management". 4th Edition. Mc Graw
Hill, 1992.
[9] R. Handfield, I. Ernest & J. Nichols, "Introduction to supply chain
management". Michigan State University, Memphis University, pp. 1-
24, 1999.
[10] S. Graves & S. Willems, "Optimizing strategic safety stock placement in
supply chains". Manufacturing & service operations management,
inform. Winter 2000. Pp. 68-83, 2000.
[11] F. El Dubei & M. Matoug, A simulation model for minimizing the
customer inventory cost in a supply chain, periodical scientific
international journal, vol. 1, no.2, pp. 14-27, 2006.
[12] S. Chopra & P. Meindl, "Supply chain management strategy, planning,
and operation". Prentice Hall, Inc.; Upper Saddle River; New Jersey; pp.
3-60; 169-171; 2001.
[1] R. A. Hokoma, M. K. Khan & K. Hussain, "Investigation of the senior
management strategy towards implementing manufacturing, planning
and control techniques and philosophies within the Libyan cement
industry: a case study", Proceeding of the 23rd ISPE International
Conference on CAD/CAM, Robotics and Factories of the Future,
Bogota, Colombia, 2007.
[2] F. El-Dubei & R. A. Hokoma, "Minimizing inventory costs throughout
the supply shain within a cement factory: A Case Study, MEQA, 4th
Annual Congress, Dubai, UAE, 2010
[3] F. Grange, "Challenges in modeling demand for inventory optimization
of slow-moving items". Proceeding of the 1998 winter simulation
conference. Pp. 1211-1217, 1998.
[4] M. Mobbs, (2001), The mineral industry of Libya, U.S. geological
survey, available at: <http://minerals.usgs.gov/minerals/pubs/country>
[Accessed 17th November 2011].
[5] R. A. Hokoma, M. Tughar, R. Abdussalam, E. Ramadan & S. Bindra,
Strategic impact of JIT techniques for construction industry, Proceeding
of the Second International Engineering Conference on Construction and
Development, Gaza, Palestine, 2007.
[6] R. A. Hokoma, M. K. Khan & K. Hussain, Investigation into the Various
Implementation Stages of Manufacturing and Quality
Techniques/Philosophies Within the Libyan Cement Industry, Journal of
Manufacturing Technology Management, Volume 19, No. 7. Pp. 893-
906, 2008.
[7] R. Abdulssalam, R. A. Hokoma, M. Esbiga & H. Omer., Strategy
applied towards implementing JIT and MRPIUI planning and control
techniques within Libyan construction and cement industries,
proceedings of the international conference on technology management
(ictm), Kuala Lumpur, Malaysia, 2006.
[8] R. Operta & P. Taylor, "Operations Management". 4th Edition. Mc Graw
Hill, 1992.
[9] R. Handfield, I. Ernest & J. Nichols, "Introduction to supply chain
management". Michigan State University, Memphis University, pp. 1-
24, 1999.
[10] S. Graves & S. Willems, "Optimizing strategic safety stock placement in
supply chains". Manufacturing & service operations management,
inform. Winter 2000. Pp. 68-83, 2000.
[11] F. El Dubei & M. Matoug, A simulation model for minimizing the
customer inventory cost in a supply chain, periodical scientific
international journal, vol. 1, no.2, pp. 14-27, 2006.
[12] S. Chopra & P. Meindl, "Supply chain management strategy, planning,
and operation". Prentice Hall, Inc.; Upper Saddle River; New Jersey; pp.
3-60; 169-171; 2001.
@article{"International Journal of Mechanical, Industrial and Aerospace Sciences:55583", author = "Faraj Farhat El Dabee and Rajab Abdullah Hokoma", title = "Just-In-Time for Reducing Inventory Costs throughout a Supply Chain: A Case Study", abstract = "Supply Chain Management (SCM) is the integration
between manufacturer, transporter and customer in order to form one
seamless chain that allows smooth flow of raw materials, information
and products throughout the entire network that help in minimizing
all related efforts and costs. The main objective of this paper is to
develop a model that can accept a specified number of spare-parts
within the supply chain, simulating its inventory operations
throughout all stages in order to minimize the inventory holding
costs, base-stock, safety-stock, and to find the optimum quantity of
inventory levels, thereby suggesting a way forward to adapt some
factors of Just-In-Time to minimizing the inventory costs throughout
the entire supply chain. The model has been developed using Micro-
Soft Excel & Visual Basic in order to study inventory allocations in
any network of the supply chain. The application and reproducibility
of this model were tested by comparing the actual system that was
implemented in the case study with the results of the developed
model. The findings showed that the total inventory costs of the
developed model are about 50% less than the actual costs of the
inventory items within the case study.", keywords = "Holding Costs, Inventory, JIT, Modeling, SCM", volume = "6", number = "9", pages = "1923-4", }